On Thursday, we discussed performance and governance, with a focus on the importance of conducting a stakeholder impact analysis. Stakeholders are individuals or groups with an interest or claim in a company. They can be internal (i.e. employees, stockholders, members of the board of directors), or external (i.e. customers, creditors, investors, suppliers, etc). The company must consider stakeholder claims in developing and implementing their strategy by performing an impact analysis, which involves identifying the stakeholders’ interests and concerns and the resulting strategic challenges.
Another major topic from the lecture was the importance of ethics and strategy. Ethics are accepted principles of right or wrong governing conduct of a person, a profession, and/or an organization. Companies will often face ethical dilemmas when forming their strategy. Such dilemmas can include self-dealing, anticompetitive behavior, opportunistic exploitation, substandard working conditions, environmental degradation, and corruption.
Hasbro, in particular, is proud to have an ethical approach to doing business embedded into the company’s culture, values and day-to-day work environment. The company started a formal ethics program in 1991, when they introduced a comprehensive Code of Conduct with mandatory training for employees. In 1994, Hasbro’s Chief Legal Officer (CLO) also assumed the position of Chief Ethics Officer. I was particularly impressed to learn that last month, Hasbro was named as one of Ethisphere’s 2012 World’s Most Ethical Companies. In addition to the company’s ethical business practices, part of the reason for the honor was the announcement in 2011 that Hasbro’s major toy brands are now being packaged in more environmentally friendly containers.